The U.S. Securities and Exchange Commission (SEC) has initiated legal action against the cryptocurrency company NovaTech and its co-founders, Cynthia and Eddy Petion, accusing them of orchestrating a fraudulent scheme that raised over $650 million from more than 200,000 investors globally, including a significant number of Haitian-Americans.
According to the SEC, NovaTech and the Petions assured investors that their funds would be secure and profitable from the outset. Instead, the Petions allegedly used new investments to pay off earlier investors and fund commissions for promoters while diverting millions of dollars for personal gain. This scheme, which lasted for four years, ended with NovaTech’s collapse in May 2023.
The lawsuit, filed in Miami federal court, follows a similar suit by New York Attorney General Letitia James, who estimated the fraud’s total value at over $1 billion. NovaTech is accused of exploiting victims’ religious beliefs through various social media platforms, including Telegram and WhatsApp, and promoting the company in Haitian Creole, with Cynthia Petion presenting herself as “Reverend CEO” and claiming NovaTech was a “divine vision.”
The SEC’s case also includes charges against six NovaTech promoters for fraud. These promoters allegedly continued recruiting new investors despite noticeable issues like delayed withdrawals and regulatory warnings in the U.S. and Canada. One promoter, Martin Zizi, has agreed to a $100,000 civil fine.
Both lawsuits seek restitution for the victims and impose civil penalties on the defendants.
